The COVID-19 pandemic is impacting the Canadian labor market and the mobility of foreign workers. However, also in view of the recovery, we must not forget that the European Union is Canada's second largest trade and economic partner. The strong growth of the Canadian economy in recent years has increased the demand for foreign workers and professionals with specialized skills. What to expect after COVID-19?
The closure of Canada's international borders caused by the pandemic has had a significant impact on immigration and the mobility of foreign workers. Professionals have more difficulty entering Canada than they did before March 2020.
The crisis caused by the restrictions has also generated macro changes at the economic level.
Canada's historically low unemployment rate suddenly jumped to 13% in April 2020, before falling to 9.2% in September 2020.
In December 2020, employment again increased by 44,200 thanks to new jobs in health care and social care, transportation and storage that have offset continued losses in industries most heavily impacted by the restrictions, such as accommodation and food services, the arts, entertainment, and leisure.
It is very likely that the 19-COVID pandemic will have an impact on the Canadian labor market for a long time.
Although it is important that we stay focused on the perspective of a recovery of the economy, relations, and exchanges between Canada and Europe. Examining the pre-pandemic skill shortage sectors in Canada, they likely be more inclined to integrate international professionals in the post pandemic transformation.
Skills shortage has in fact been one of the most widespread issues among Canadian businesses in recent years. About 40% of Canadian companies (small and medium-sized) have difficulty in hiring new employees.
In 2018, 527,000 jobs were vacant, 3.2% of the job demand.
Why does Canada have so many job vacancies?
Over the last few decades the significant knowledge-based economic development required new skills. At the same time, there are important demographic changes in the labour force in Canada. Work popolutation is ageing, due to lower fertility and longer life expectancy. Many people retired and young people are still completing their education.
Many canadian companies therefore have economic trends suitable for corporate expansion policies also towards new markets, but are not supported by the availability of skills on the domestic market.
Where to find the missing skills?
One of the solutions available to companies grappling with this dilemma is the market for foreign workers.
There are almost 470,000 foreign nationals with a work permit that became effective in 2019, compared to 340,000 in 2017 and 390,000 in 2018.
The COVID-19 pandemic has certainly affected the flow and permanence of these workers.
Although TFWs are allowed to enter Canada, travel restrictions in some countries of origin, fear of getting sick, and mandatory 14-day quarantine upon arrival are deterring transfers.
Not to mention that within companies that are temporarily closed or that have reduced their activities, layoffs could occur precisely in the direction of temporary foreign workers.
In any case, let's not forget that the European Union is the second largest trade and economic partner of Canada after the United States. This privileged relationship also affects the flow of qualified people.
The subject is addressed within the CETA (Comprehensive Economic and Trade Agreement), by the chapter dedicated to the mobility of workers (Chapter 10 - Temporary entry and stay of natural persons for business purposes) in which legal certainty is provided to qualified workers who they temporarily move to the EU or Canada to carry out a business activity.
As for Italy, more recently, a bilateral agreement has been added for the mobility of young students and workers. After ratification, already scheduled by the Canadian Parliament, young people between 18 and 35 who want to go to study or work in Canada will be able to obtain a special 12-month visa, renewable for up to 24 months. The same opportunity will be given to Canadians who want to enter Italy.
Canada's entry options for European skilled workers also include the Global Skills Strategy, a federal program designed to provide a fast track - the application is processed in 10-14 business days - available to employers who have need for highly-qualified talents, especially in the tech industry, and for researchers.
Workers can enter Canada to perform work for 15 consecutive days or less if at least six months have passed since the last use of this exemption or for 16-30 consecutive days if at least 12 months have passed since the last use of this exemption. Researchers are eligible for a 120-day work permit exemption. Renewals and consecutive uses of the exemption are not allowed.
Workers exempt from the Labor Market Impact Assessment (LMIA) can also access this program.
Almost 40,000 talents arrived in Canada as part of the Global Skills Strategy. About half are highly skilled workers in occupations such as programming, information systems analysis, and software engineering.
Source: Invest in Canada
The fast - track is also open for the flow of temporary foreign workers hired with the Global Talent Stream. In this case, you are not exempt from the Labor Market Impact Assessment (LMIA).
Innovative companies can hire a worker for a position with skill level 0 (senior management) or skill level A (professionals), according to the classification of the National Occupation Classification. Companies are required to develop a Labour Market Benefits Plan that demonstrates your commitment to activities that will have lasting, positive impacts on the Canadian labour market.
In 2 years, over 1,000 Canadian employers have used the Global Talent Stream, creating nearly 50,000 jobs.
What does CETA provide to facilitate the mobility of workers
Within the framework outlined thanks to chapter 10 of the CETA, European companies and professionals have access to specific work permits, accessible without the need for further bilateral agreements between Canada and the country of origin of the worker and the same in any province or Canadian territory.
CETA Chapter 10 provisions stipulate that each Party shall allow temporary entry to natural persons for business purposes, and make sure that it applies these provisions to avoid any delay in trade of services or the conduct of investment activities.
CETA is therefore a facilitator in the recruitment of professionals and an opportunity for mobility and transfer for skills.
Mutual Recognition Agreements (MRAs) relating to temporary entry of professionals
Canada and the EU have different regulations of professional qualifications, and it was considered essential to define a common reference framework given the impact of worker mobility on this matter.
CETA’s Chapter 11, is therefore dedicated to the Mutual Recognition of Professional Qualification (MRPQ) with the aim to establish a clear process to be followed by relevant entities from Canada and the EU when seeking to negotiate the Mutual Recognition of Professional Qualifications (MRA).
The key provisions of this chapter are:
• Recognition: each Party shall allow a professional covered by an MRA to pursue professional activities, in accordance with the MRA, regardless of where he/she has been educated, or of any requirement of citizenship or residency in the Party’s territory. In addition, the treatment afforded to each other’s professionals shall not be less favourable, than the one provided to their domestic professionals.
• Creation of a joint committee on cooperation for the recognition of qualifications: this committee is comprised of Canadian and EU government officials. Its role is to ensure that the negotiated MRAs are consistent with CETA’s provisions. In this regard the Joint Committee oversees the MRAs negotiating process and evaluate the MRA proposals developed by regulatory bodies from each Party.
• Creation of guidelines for the negotiation and conclusion of agreements on the MRPQ: these guidelines are intended to ensure regularity between MRAs recognised under CETA.
Thanks to the MRPQ chapter, therefore, members of professional bodies covered by an MRA negotiated between Canada and the EU would be able to enter Canada to carry out their activities, regardless of country of education or training
In-demand sectors for workers in Canada
To facilitate access to the Canadian market for European companies, the EU delegation in Canada has commissioned a guide to help EU companies and professionals understand how they can concretely benefit from CETA provisions, when expanding their business overseas. It also provides a step-by-step outline on how to apply for each work permit falling within the scope of CETA Chapter 10.
The Ceta Report on Mobility of Professionals produced by Immetis, a Canadian law firm dedicated to immigration and international mobility in Canada.
While Ontario, Québec or British-Columbia are facing major skills shortages, the situation in Newfoundland and Labrador is stable.
EU companies/individuals wishing to enter the Canadian market should therefore consider both the most demanded sectors and the needs that emerge locally.
Work permits that fall within the scope of a free trade agreement such as CETA are treated under the International Mobility Program (IMP) to allow the employer to temporarily hire a foreign worker.
These permits are exempt from the requirements of the Labor Market Impact Assessment (LMIA), that is, to demonstrate the need for that foreign worker for that given position and that no Canadian or permanent resident is qualified and available to do the job.
Chapter 10 of the agreement covers 3 categories of business visitors:
- Key personnel: including intra-corporate transferees; investors and business visitors for investment purposes
- Contractual service suppliers and independent professionals
- Short-term business visitors
Each LMIA exemption has a specific code. By analyzing the codes, we are therefore able to estimate which European professionals are most in demand in Canada or who have had access to work permits under CETA.
T43 Service Suppliers
Persons employed by an enterprise that has no establishment in the territory of the other Party and that has concluded a bona fide contract to supply a service.
T47 Independent professionals
Persons engaged in the supply of a service and established as self-employed who have no establishment in the territory of the other Party and have concluded a bona fide contract to supply a service.
CETA includes a list of service sectors applicable to contractual service suppliers and independent professionals.
To qualify, the EU professional must hold the following qualifications:
• a university degree or a qualification demonstrating knowledge of an equivalent level
• professional qualifications, if required, to practice an activity pursuant to the laws or requirements in the province or territory where the service is to be supplied in Canada.
T48 – Engineering technologists and scientific technologists
This work permit is subject to the same criteria as the T43 and T47 work permits (contractual service suppliers and independent professionals), to the exception of educational credentials:
• Engineering technologists: a 3-year post-secondary degree from an officially recognised institution in engineering technology;
• Scientific technologists: a 3-year post-secondary degree from an officially recognised institution in the discipline of agriculture, architecture, biology, chemistry, physics, forestry, geology, geophysics, mining or energy.
T44 – Intra-corporate (company) transferees - Senior personnel and Specialists
Persons employed in an enterprise (for at least one year) and temporarily transferred to a subsidiary or parent company in the territory of the other Party in one of the following categories:
- Senior managerial or executive capacity
- Specialised knowledge
- Graduate trainee
T45 – Intra-corporate (company) transferees’ spouses
Spouses of EU citizens, who are intra-corporate transferees to Canada, are eligible to an open work permit for the same duration as their spouses’ work permit.
T46 – Investors
Persons who establish, develop, or administer the operation of an investment.
- in a capacity that is supervisory or executive; or as an investor
- as employees of an enterprise that has committed or is in the process of committing a substantial amount of capital.
The business visitor category facilitates entry to Canada for people who intend to engage in international business activities in Canada without directly entering the Canadian labour market (thus no work permit required). Under CETA, there are two categories of business visitors: short-term business visitors and business visitors for investment purposes.
The following tables are taken from the EU delegation in Canada Mobility Report and show the top 10 National Occupational Classifications for work permit applications issued, between fourth-quarter 2017 and fourth-quarter 2018 under the LMIA exemption codes.
In 2018, most of the work permits issued under a CETA Labour Market Impact Assessment (LMIA) exemption codes were T44 work permits. These considerations show the need for specific management and engineering skills.
Senior Executives and Engineers are highly represented, as well as business professionals.
The National Occupational Classification (NOC) is Canada’s national system for describing occupations. NOC provides a classification structure that categorises all occupational activity in Canada.
CETA work permits issued to Italian citizens (2017-2020)
The Centro Studi Italia-Canada has had access to data relating to special permits issued to Italian citizens in the last 3 years thanks to the CETA provision on mobility of professionals.
The prevalence of T44 permits, or intra-group transfers of Seniors and specialists, is also confirmed for Italy. Ontario is the top destination, with its innovative vocation, and the Toronto-Kitchener-Waterloo technological Corridor, nicknamed the Silicon Valley of the North, certainly contributes to its ability to attract the most skilled workers.
Alberta, which has a strong presence of Italian companies, however, has not seen a particular flow of Italian professionals.
Is it a sign that the internal supply of skills meets the demands coming from the world of work?
As for Independent professionals (T47), Italian mobility to Canada still appears to be very limited. The collapse of 2020 can be explained by the pandemic and the general contraction in the mobility of people and temporary workers.
The reduced flow in correspondence with years with extremely positive economic indicators for Canada (2018 and 2019) is instead unexpected.
Source: Canadian Embassy in Rome
CETA works permits: still little known?
Also the so-called service providers still have a slow penetration in Canada, at least as regards the channel provided by CETA.
The reasons could be different and, in this context, only conceivable:
- The lack of information on the opportunities offered by CETA;
- insufficient preparation by the Italian services sector on the positivity present in the Canadian market;
- a delay in the development of some professionals, such as export managers and experts in the internationalization and promotion of Made in Italy. They could benefit more than others from the facilitated and temporary mobility provided by CETA thanks to the excellent manufacturing trends.
Indeed Italian business visitors don't need a work permit o a visa and this is probably the main explanation because they remain low in the statistics. All they need is to apply online for an eTA, a mandatory travel authorisation to fly to Canada without a visa or a work permit for a holiday, business trip, a visit to friends or family or a transfer to another country.
Moreover, notice that the EU delegation in Canada report on Mobility of Professionals does not show much more consistent flows in the wider European context than the Italian ones. The overall number of permits issued to European workers who have moved to Canada under Chapter 10 of CETA is not yet at the expected levels.
This does not necessarily mean that European temporary workers did not go to Canada. Most likely, at the moment, streams from Europe through the CETA specific work permits are smaller compared to those that need a LMIA (Assessment of the impact on the labor market).
A Labour Market Impact Assessment (LMIA) is a document that an employer in Canada may need to get before hiring a foreign worker. To obtain a positive LMIA the employer must demonstrate that the foreign professional is necessary to fill the job and skill shortage. It will also show that no Canadian worker or permanent resident is available to do the job.
We are wondering why trade between Europe and Canada has been greatly enhanced since the first 3 years of application of the Treaty, while the number of permits issued to temporary workers in application of Chapter 10 CETA does not match in this more lively relationship between the two sides of the Atlantic? All parties will have to reflect on this.
The post-COVID-19 recovery, with the revival of commercial relations, should therefore also be an opportunity to monitor the impacts and better understand the functioning of CETA.
*Journalist, Digital Human Consultant
Don’t want to miss the updates of the Centro Studi Italia-Canada?